There are different interest groups both within and outside the business organization whose, often, conflicting interests the business has to keep in view, reconcile and satisfy in a balanced manner. These different interest groups are:
Owners or shareholders: The social responsibilities of business to this group include (1) fair and regular return on investment (2) safe and steady appreciations of investment , (3) periodical disclosure of full and accurate information regarding financial and functional aspects of business and (4) reasonable representation to minority shareholders to participate in business management.
Employees: The labor force is the mainstay of any business and therefore the latter’s responsibility towards it is all the more greater . These responsibilities are (1) fair wages, (2) security of employment (3) safe and secure working conditions (4) representation in decision making bodies which effect their working life ( 5) providing fair opportunity for personal advancement through education and training, (6) meaningful freedom and job satisfaction and ( 7) humane treatment.
Consumers: The obligations of business to this group are: (1) supply goods of right quality, and right quantity at the right place and time at reasonable prices ( 2) provide goods and services according to the needs, tastes and preferences of different classes of customers (3) inform and educate the customers on the availability and use of alternative products which may be cheaper and better (4) be honest and truthful in advertising the products (5) provide prompt efficient and effective after sales services , (6) extend a hearty and courteous service and (7) avoid un-healthy trade practices like black marketing, hoarding and adulteration etc.
Responsibility to creditors and Suppliers:
The responsibilities include:
(1) provide accurate information regarding the financial health of the firm (2) ensure a reasonable price for the articles supplied and make prompt repayments (including interest on borrowings there should be fairness in transactions and (3) promote a healthy atmosphere where creditors suppliers and other interest groups are treated as partners in a co-operative endeavor.
General Public or community at large: The obligations of business to this group include (1) proper and effective utilization of natural resources to produce cheaper and better goods, thereby rendering help to generate indirect self employment opportunities , (2) maintain a healthy environment free from all sorts of pollution in and around the business area to protect the health interests of people residing in the vicinity (3) contribute liberally and voluntarily to the community development and public utility services which promote communal harmony and cultural enrichment , (4) help maintain law and order in the society by refraining from aiding and abetting anti social elements or activities and (5) avoid exploiting the religious sentiments or backwardness of the minorities and weaker sections of society.
Government: Business will be discharging its duties to the government if it (1) pays taxes regularly and correctly (2) applies faithfully to all the laws governing regulations of business, (3) avoids lobbying through donations to political parties ( 4) follows a fair trade policy and refrains from unhealthy business practices like hoarding , black marketing and corruption etc (5) contributes its mite to the socio economic growth a goals of the nation ( 6) helps in tackling the problems of unemployment, poverty and price rise, etc and (7) helps in establishing a secular democratic and socialistic patent of society.
Social responsibilities as citizens: According to Davis improving society increases economic activity. Because it will eventually receive increased profits because of this increased activity, it is obligated to share in solving social problems thus, business has a responsibility for improving education – even though business has not directly caused educational problems – because business will benefit from improvements in education.
Source: Strategic Management